Marriot/Starwood Merger and Project Management Theories
Background: Marriott / Starwood Merger In 2016, the Marriott hotel group acquired the Starwood hotel group for $13.6 billion, making it the largest hotel company in the world. Prospective customers from both chains will have an expanded choice of over 5700 hotels across 100 countries.
In addition to creating the world’s largest hotel empire, the merger of the two loyalty programs resulted in the largest loyalty programme of its kind, drawing on the strengths of each one.
Integration of disparate systems was never going to be easy but was feasible and relatively logical all the same. Analysis of several top City hotel markets across the globe reveal local room night market share. The implications of the merger are significant: in 14 of the world's top 20 cities, the new merged group will have nearly a third of the corporate travel hotel spend, rising to half in some places. The pressure for this merger to proceed smoothly and quickly was immense. You should carry out independent research on the above merger. As you do so, you will learn of the following:
• immense difficulties regarding integration of IT systems, particularly regarding the new loyalty programme
• merging of membership files were problematic
• reports of call centres not being manned to the usual levels, calls being purposely dropped when difficult questions were asked or contradictory information being received when calling back
• internal and external communication issues
• bad PR via websites and social media
Task
You are required to produce a critical analysis report of 2,000 words (+/- 10%), excluding appendices and references. The report should use appropriate concepts taken from this course to provide a critical appraisal of the project management of the Marriott/Starwood merger
You must provide an appropriate background of the concepts of Project Management, using literature in the proper manner. You should provide a brief description of the situation you will be using for your critical appraisal. You must the link the concepts to the situation you are appraising and use the concepts to provide the appraisal.
You may choose to handle this assessment in a variety of ways. For example, you might take an overview of Project Management and/or choose to focus on one detailed topic of Project Management (e.g. Project Planning or Communication). Whatever you choose you must justify your choices.
Notes
• Do not search the internet for information and merely present it as your own. You must interpret the information and critically reflect on it. Remember the Bias Questions (Who, What, Where, When, Why and How)
• Be prepared to put in independent study and research
• Wikipedia is NOT an academic source and will be marked down. Use the library to access peer-reviewed academic journals and text books, especially when discussing theories, concepts and methodologies
• Plagiarism is taken very seriously and the consequences are severe, so make sure you properly reference your sources
• Assignments are to be submitted via Turnitin ONLY
MARRIOT/STARWOOD MERGER AND PROJECT MANAGEMENT THEORIES
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Marriot/Starwood Merger and Project Management Theories
Introduction
Merger and acquisition projects increase synergies, market share, diversification, and economies of scale. The process relies on effective project management theories and approaches, including communication, risk management, and financial planning. A merger is a specific agreement uniting two companies (Silvius, 2018). Different companies have specific reasons for the merger. However, the common reason for a merger is to allow a company to expand and reach another segment that it cannot afford independently. For instance, the merger between Marriot and Starwood at $13.6 billion made it the largest hotel empire (Dogru et al., 2018). Besides, whenever a company purchases above 50% of the assets and provided stocks, the key decisions rely on the primary company. The ultimate approach to mergers and acquisitions is a reliable growth strategy. A company must overcome logistical and physical constraints that may hinder the project thresholds. A reliable growth strategy is essential since it gives a company a diversified economy of scale and reduced competition in the industry. Therefore, a promising company for acquisition must have a promising growth strategy and positive revenue stream.
The main objective is to look into a merger between Marriot/Starwood using a unique project management lens and theories. According to Maung et al. (2019), mergers and acquisitions are often accompanied by specific constraints such as communication problems and poor financial planning. Therefore, after summarizing the case and identifying the company's problems, specific management theories will be addressed to ensure future recommendations shape the company's growth. Besides, the paper will also integrate elements such as project cycle elements, including selection, planning, and closeout. The identified elements are necessary for the acquisition process to avoid possible challenges and focus on the success ideologies.
Project Management Theories
Communication
Communication is one of the major challenges noted in the Marriot/Starwood merger. Communication is the process of sharing opinions and ideas between different professionals to make a project successful and appealing (Meglio and King, 2019). However, in mergers and acquisitions, the communication process should target different areas, such as task alignment. The Marriot/Starwood had a major challenge of communication which led to different issues such as poor manning of usual levels and dropping of difficult questions throughout. Therefore, proper communication is essential for promoting effective project management during mergers and acquisitions. Communication is essential in a project merger since it allows the professionals to accurately set sustainable and achievable goals (Zulch, 2014). It also allows the project owners to focus on better strategies that would not ensure the successful sharing of stocks and merger requirements. Besides, effective communication is necessary for the professionals to establish a reliable framework and a strategic direction for the employees of the two companies (Ziek and Anderson, 2015). It also transforms the company to focus on new goals and uniformly mobilize workers to achieve them. Therefore, whenever the two companies focus on a better direction, it would be easy to meet acquisition goals. The primary company should focus on effective communication.
Communication is essential in different projects since the teams have a unique way of attracting and managing informed tasks. The communication approach considered in managing a merger should also integrate specific elements such as leadership. Project managers take most of their time engaging the leaders and streamlining the project goals in specific directions. Leaders must also communicate with other stakeholders to make them understand the necessities of mergers (Lauren, 2018). Communication is substantial in mergers since it would help professionals integrate merger requirements and enhance idea-sharing. Two major communication strategies are crucial in merger processes, including meetings and surveys. There should be consistent meetings with the project participants to avoid any issues which may arise during mergers and acquisitions (Saltz et al., 2018). The project mergers must consider all their input to reduce any issues that may jeopardize the process. The participants must anticipate any necessary questions that may make the process successful. Meetings are a critical part of communication since they allow the participants to acquire primary information and avoid any issues which may affect their inclusivity in the merger (Richardson and Jackson, 2018). Lastly, surveys make it easy to meet the merger thresholds and avoid specific mistakes which may jeopardize the process. Therefore communication is essential in merger and acquisition, and the two companies should adequately consider it throughout the merger process.
Risk Management
Risk management is also a critical aspect necessary during mergers and acquisitions. Effective communication through surveys and meetings allows the participants to limit possible merger challenges. Risk management is essential for acquisition and refers to identifying, evaluating, and mitigating risks to ensure higher goal achievement and outcome. Besides, project managers, especially in merger projects, should be responsible for overseeing any potential risks and eliminating them before they jeopardize the process (Sols, 2018). For instance, timely communication is necessary to avoid any possible challenges, such as lack of clarity on various projects. It is also necessary to focus on suitable risk management aligned with specific goals. Therefore effective risk management reduces project failure and improves the capacity to achieve better goals and development.
Application of Project Management Theories
Effective communication is a key element which lacked in the merger between Marriot and Starwood. Two specific elements showed a lack of information, including external and internal communication issues. Communication is significant for the merger since all the merging companies are based in the hotel industry. External communication is essential in a merger since it determines information access between the merging companies (Hopkin, 2018). It also links the merging companies to the shareholders, suppliers, and potential customers. Starwood acquisition required a well-established communication framework that would limit potential mistakes and issues noted, including PR and issues in social media. The issues that emerged during the Starwood acquisition would have been avoided through quality channeling information. Angwin et al. (2018) define a communication channel as s the approach used by a specific organization in transmitting the information. With a reliable communication channel, minimizing any possible challenges such as financial constraints and quality issues noted in the merger is easy. Besi...